Nearly 50% of the population in the Philippines live in rural areas and depend on agriculture as a primary source of income. Consequently, poverty in the Philippines is most severe and widespread in rural areas where almost 80% of the country’s poor live. Overall, one out of three people in the Philippines lives in poverty. The southern island groups of the Autonomous Region of Muslim Mindanao (ARMM( and the Bicol in the Visayas region have seen the greatest increase in poverty since the early 90’s. For the microentrepreneurs working to break the cycle of poverty, accessing financial services that are designed to serve small businesses or provide microloans are exceptionally challenging. Most financial institutions continue to focus on traditional customers, focused on large firms and capital-intensive industries. However, for a woman that operates a sari store, sells fish, or works a farm, small loans of $80 USD can make the different between a lifetime of poverty and the first step to working themselves out of poverty.
The Entrepreneur and the Solution
Founded in 2003, LifeBank, Foundation, Inc. is changing the status quo. One of the Philippines’ fastest-growing microfinance institutions (MFIs) in the Philippines, LifeBank is dedicated to providing financial opportunities for the poor, specifically women. The need is evident. In 2007 alone, LifeBank has grown from serving 61,000 women to nearly 126,000, doubling the number of clients it serves over the last two years. Recently expanded from its original location in central Philippines (the Visayas region), LifeBank is now reaching women in the rural areas of Luzon and Mindanao. With a vision for nationwide growth, LifeBank plans to grow to serve more than 270,000 clients by 2009.
Vincent Perlas is President of the LifeBank Foundation. Trained in agribusiness and public health, Vincent chose to dedicate his time exclusively to microfinance in 2005. After years of working in banking and agriculture in nonprofit and for-profit capacities, he began to believe in the promise of microfinance as a serious solution to worldwide poverty. Although he admits that poverty is caused by a spectrum of factors, he firmly believes that the lack of financial services for the working poor, the majority, is one of the core sources of the problem.
"The answer to worldwide poverty is the need for unity and cooperation among sectors. Government, the private sector, and the civil society must work together to bring the poor into the economic system. With nearly 50 percent of the Philippines population living on less than $2 a day, there is a tremendous need to expand the reach of microfinance in our country and serve the working poor," said Vincent Perlas.
At the helm of LifeBank, Perlas has led the organization to realize tremendous growth over the past several years. Navigating through complex regulatory and business environments in the Philippines, LifeBank uses disciplined commercial practices to address its social mission. Perlas has a unique passion for addressing the needs of the poor while maintaining a vision for large scale growth.
While in the Philippines, Global X interviewed Vincent Perlas. Watch him as he describes his three ingredients to success: "Keep a high spirit, get the right methodology, and make sure you have enough gas to grow!"